Articles Posted inRegional Centers

On December 6, 2016 Congress passed a continuing resolution to fund government programs through April 28, 2017. Among the programs that qualified to receive additional government funding was the EB-5 Regional Center Investor Program, a program made possible by a Congressional statute. The Continuing Resolution effectively extended the EB-5 Regional Center program through April 28, 2017 with no changes to the program’s policy. With time running out, Congress must either extend the statutory deadline once again to September 30, 2017, or pass reforms to the program. The government is currently holding Congressional hearings to make changes to the EB-5 Regional Center Program. It appears that legislators are contemplating overhauling the EB-5 program altogether, instead of extending the validity period of the program. At this stage, however, it is not likely that a major overhaul of the EB-5 program will take place by April 28th.

Proposed Rule EB-5 Immigrant Investor Regional Center Program

For their part, the U.S. Department of Homeland Security has already introduced a series of proposals in the Federal Register to modernize the EB-5 Immigrant Investor Program. The comment period for the proposed rule closed on April 11, 2017.

Among its major provisions the Department’s proposed rule would authorize:

For investors seeking to invest in a new commercial enterprise that will be principally doing business in a targeted employment area (TEA), DHS proposes to increase the minimum investment amount from $500,000 to $1.35 million;

DHS is proposing to make regular CPI–U-based adjustments in the standard minimum investment amount, and conforming adjustments to the TEA minimum investment amount, every 5 years, beginning 5 years from the effective date of these regulations;

Revisions to the TEA designation process, including the elimination of state designation of high unemployment areas as a method of TEA designation;

DHS proposes to allow any city or town with high unemployment 4 and a population of 20,000 or more to qualify as a TEA;

DHS proposes to eliminate the ability of a state to designate certain geographic and political subdivisions as highunemployment areas; instead, DHS would make such designations directly;

Revisions to the filing and interview process for removal of conditions on lawful permanent residence.

Today, October 24, 2016 the Department of Homeland Security published the final rule increasing fees for certain immigration and naturalization petitions processed by U.S. Citizenship and Immigration Services (USCIS). Overall the Department of Homeland Security increased filing fees for certain petitions by an average of 21 percent. The new fees will be enforced by USCIS beginning December 23, 2016. The fee schedule has been adjusted following the agency’s decision to conduct a comprehensive review of filing fees for fiscal year 2016/2017. USCIS determined that an adjustment in the filing fees would be necessary in order for USCIS to recover costs for services expended and maintain adequate service. The proposed fee schedule was first published on May 4, 2016. The final rule clarifies that all persons applying for immigration benefits may be required to appear for biometrics services or an interview, and thus must pay the biometrics services fee accordingly.

EB-5 Investor Visa Program

The EB-5 Immigrant Investor Visa Program will be most heavily impacted by the new fee schedule. The new filing fee for Form I-924, Application for Regional Center under the Immigrant Investor Pilot Program, will increase by a rate of 186% requiring Regional Centers seeking designation under the program, to pay a filing fee of $17,795 instead of the current rate of $6,230. Regional Centers will be required to pay a $3,035 annual fee to certify their continued eligibility for the designation.

The filing fee for the I-526 Immigrant Petition by Alien Entrepreneur, an application associated with the EB-5 visa program, will increase to $3,675, a 145% increase up from the current rate of $1,500. The filing fee for an investor’s petition to remove conditions on residence remains unchanged.

Naturalization

USCIS has established a three-tiered fee schedule for naturalization applicants filing Form N-400 Application for Naturalization. First, the fee schedule includes a standard filing fee for most applicants, from a rate of $595 to $640. Second, DHS has established a reduced fee of $320 for naturalization applicants whose household income is greater than 150% but less than 200% of the Federal Poverty Guidelines. Third, there will be no filing fee for naturalization applicants who are members of the military, applicants with approved fee waivers, and others who may qualify for a fee waiver according to sections 328 or 329 of the Immigration and nationality Act (INA).

By the end of this month the EB-5 Immigrant Investor Visa Program will be up for renewal before Congress. The EB-5 program was first established by Congress in 1990 in an effort to increase the amount of foreign capital investment in the United States, and to create new jobs for Americans. In 1992 Congress expanded the program and created the Immigrant Investor Visa Program as we know it today, which allows foreign investors to invest in an EB-5 Regional Center project. A regional center is an authorized organization, entity, or agency that is designated by USCIS to sponsor capital investment projects within a specific geographic area including areas of high-unemployment or rural areas. Section 203(b)(5) of the Immigration and Nationality Act, 8 U.S.C. Section 1153(b)(5) limits the number of immigrant visas that may be issued to EB-5 investors to 10,000 immigrant visas per fiscal year, provided the qualified investor is seeking permanent resident status on the basis of the creation of a new commercial enterprise. Half of these visas are allocated to EB-5 investors participating in a regional center pilot program. The required investment amount in a new commercial enterprise is $1,000,000 or $500,000 if the investment is being made in a targeted employment area experiencing a high unemployment rate of 150% relative to the national average, or a designated rural area as established by the Office of Management and Budget (OMB).

Despite its promise to increase economic growth, the EB-5 Immigrant Investor Program has been the subject of much criticism due to an increase in fraud on behalf of investors and regional centers, as well as the continued use of unlawful funds. This month, the United States Government Accountability Office (GAO) published a report that will be reviewed by Congress and USCIS, in consideration of new measures that may be implemented by Congress as part of the program’s renewal process. The report outlines the inherent weaknesses of the EB-5 program and areas of concern.

About Jacob J. Sapochnick

Jacob Sapochnick is recognized as one of the most innovative, up and coming Immigration Lawyers in the nation. He devotes 100% of his practice to Immigration Law, representing Corporations, Hotels, Restaurants, and other organizations, as well as, entrepreneurs, and individuals worldwide. He also provides legal support and representation in family sponsored immigration matters.more >>

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